Vietnam’s economy: growing too fast

Further stress tests of IRELAND'S BANKS revealed that they need an extra EURO24 billion ($34.4 billion) of capital. That would push the total cost of the government bail-out to around EURO70 billion, bringing almost all of the Irish banking industry under state control.



TEXAS INSTRUMENTS, a maker of computer chips, offered to buy NATIONAL SEMICONDUCTOR, an American rival, for $6.5 billion. American and European technology stocks rallied on the news.



Australia's government said it might thwart an A$8.4 billion ($8.7 billion) bid by SINGAPORE EXCHANGE for ASX, the main Australian bourse, citing "national interest". The combined exchange would be Asia's second largest by the number of listings.



A Chinese state-owned mining company, MINMETALS RESOURCES, made a C$6.3 billion ($6.5 billion) offer for EQUINOX MINERALS, an Australian-Canadian owner of a large copper mine in Zambia. The unsolicited bid, financed entirely with cash, is the biggest yet for a Chinese mining firm. China consumes around 40% of the world's copper and is concerned about competition for supplies of the metal. Copper's price remains high, though it has slipped by around 5% from February's stratospheric levels.



Increasingly alarmed by an overheating economy, the PEOPLE'S BANK OF CHINA raised interest rates for the fourth time in five months. The rise of a quarter of a percentage point, to 6.31% for the one-year lending rate and 3.25 for the deposit rate, came as a surprise, leading analysts to suppose that inflation in March had been higher than expected.





Vietnam’s economy: growing too fast

By Ben Bland 7 April 2011



Emerging market investors tend to gravitate toward countries that have accelerating economic growth prospects. Vietnam, which has been battling regular bouts of economic instability, is one of the few fast-growing countries in the world where investors want to see growth slow down. On Wednesday, the Asian Development Bank became the latest financial institution to downgrade the Southeast Asian nation’s growth prospects for this year following the government’s unveiling of a package of measures designed to combat surging inflation and a lack of confidence in the financial system. The ADB cut its forecast for GDP growth this year to 6.1 per cent from 7 per cent, arguing that if the government successfully implements its fiscal and monetary tightening policies, growth will slow but inflation will be brought under control eventually.
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